England and Wales Court of Appeal (Civil Division) Decisions

IN THE SUPREME COURT OF JUDICATURE
COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM CHANCERY DIVISION,
CARDIFF DISTRICT REGISTRY
(HIS HONOUR JUDGE MOSELEY, QC,
Sitting as a Judge of the High Court)

		Royal Courts of Justice Strand London WC2 Friday, 10th August 2001

Friday, 10th August 2001

1. LORD JUSTICE JONATHAN PARKER: This is an application by Hallmark Travel Consultants Limited ("Hallmark"), the claimant in the action, for permission to appeal against an order made by His Honour Judge Moseley QC, sitting as a judge of the High Court on 15 June of this year, whereby he dismissed Hallmark's claim in the action. The judge refused permission to appeal and Hallmark has applied to the Court of Appeal for such permission. I refused such permission on the papers on 19 July.
2. Hallmark appears on this application today by Mr Michael Hartman (of counsel), who also appeared before the judge at the trial of the action.
3. In the action, Hallmark claims damages against the Celtic Manor Hotel Limited ("the Hotel") for repudiatory breach of an alleged contract, whereby the Hotel agreed to reserve for Hallmark 148 twin or double rooms and two suites for the period 1 November 1999 to 7 November 1999 at specified rates. The judge found that no such contract as was alleged by Hallmark had been concluded between Hallmark and the Hotel. He also rejected an alternative submission that Hallmark was entitled to what was described as a contractual option in relation to the rooms in question.
4. The background to the dispute which gave rise to the action is in summary as follows. Hallmark carries on business as a travel agent specialising in arranging group visits to hotels in the United Kingdom. In March 1998 Hallmark, acting by a Mr Wheeler, inquired of the Hotel, which is situated near Cardiff, as to the availability of 150 double-rooms for a group of 300 people from Dunlop South Africa for the period in question, 1 to 7 November 1999 (the period during which the Rugby World Cup was due to take place). Mr Hartman has told me today that Mr Wheeler was at the time subject to a disqualification order made under the Company Directors Disqualification Act 1986, but no point appears to have been taken about that at the trial and I leave it out of account for present purposes).
5. The inquiry from Mr Wheeler met initially with an unenthusiastic response from the Hotel which was, it appears, concerned that the group taking the rooms would make little use of its facilities beyond simply bed and breakfast. However, a further communication from Mr Wheeler (which the judge found to include numerous untrue statements) caused the Hotel to change its attitude. In consequence, a meeting took place on 5 May 1998 between Mr Christopher Barratt, the then sales and marketing director of the Hotel, and Mr Wheeler. Following the meeting, Mr Barratt sent a copy of his note of the meeting to Mr Wheeler. The note, which was sub-headed "Dunlop South Africa", records that 148 twin or double rooms and two suites had been "provisionally reserved for you." The specified rates are then set out. Then under the heading "Deposits", the note records that a non-refundable deposit equal to 20 per cent of room charges (amounting to approximately £30,600) was to be paid by 1 October 1998. In his covering letter Mr Barratt said this:

"As promised, this letter is to confirm the details we discussed [that is a reference to the meeting on 5 May]. These are listed on the attached sheet and if anything has been omitted please let me know. At this stage it is a little early to go into contracts. This is probably best done around September 1998 to include the first payment. However, it would be helpful to have a letter of confirmation from you."

6. Mr Wheeler replied on 18 May saying:

"We agree at that we should look be at a contract around September of this year and will no doubt you speak to you before then. In the meantime, please hold the rooms for us accordingly."

7. It is Hallmark's case that in the course of the meeting on 5 May 1998 an oral contract was concluded whereby the Hotel was then thought obliged to reserve the rooms in question (that is to say to hold them available for Hallmark), and that if Hallmark wished to take up the reservation a deposit of approximately £30,600 would be paid by 1 October 1998. Further, or alternatively as (I noted earlier), Hallmark alleges that it was a term of that contract (express or implied) that the alleged agreement operated to create a contractual option in favour of Hallmark to confirm or reject the rooms in question on or before 1 October 1998; that in consideration of the grant of that option Hallmark undertook to approach potential customers to occupy the said rooms; and that Hallmark duly did so.
8. In mid-June 1998 Hallmark was informed by the travel agent in South Africa representing Dunlop South Africa, that the group no longer wished to stay at the Hotel. Accordingly, there was thereafter, as the judge found, no longer any possibility of that group staying at the Hotel.
9. Hallmark then entered into correspondence with another travel agent in South Africa about the possibility of another group from South Africa staying at the Hotel for three nights from 5 to 7 November 1999, with departure on 8 November 1999. At that point, as the judge found, Hallmark, in the shape of Mr Wheeler, set out to deceive the Hotel by leading it to believe that the Dunlop South Africa, wished to extend its stay by one night (that is to say the night of 7 November 1999). The deception was contained in a fax dated 27 July 1998 from Mr Wheeler. The judge found that the deception was successful, in that on 30 July 1998 Mr Barratt confirmed that the reservation had been extended for one further night.
10. It was common ground before the judge that on 27 July 1998 Mr Wheeler and Mr Barratt had a telephone conversation about the date on which the deposit was payable. The judge accepted the evidence of Mr Barratt contained in a witness statement (since he was too ill at that stage to give evidence orally) that in the course of the telephone conversation the date for payment of the deposit was brought forward one month to 1 September 1998, and that Hallmark consented to that. In making his findings on this issue the judge disbelieved the evidence of Mr Wheeler. He also found that a relevant document had been tampered with, apparently with the intention of removing that part of the document which was damaging to Hallmark's case.
11. In the event the deposit was not paid. By letter dated 7 September 1998 Mr Wheeler faxed the Hotel, referring for the first time (it seems) to the new group about which he had corresponded with the South Africa travel agent, and asking the Hotel to reserve rooms for what he described as a "site inspection". The letter continued:

"Our clients are aware that they will need to pay a deposit immediately after the inspection trip and they have told me that provided they like the property this will not be a problem."

12. By a fax dated 9 September 1998 Mr Barratt responded as follows:

"I was surprise to read your fax of the 7th September. As you know I had been expecting a deposit so that we could enter into a firm contract. Not only has the deposit not been paid but it is conditional upon your client 'liking the property'. In the circumstances we do not wish to continue negotiations."

13. The judge in his judgment found that the Hotel's offer to reserve the rooms was a non-contractual offer for which there was no consideration. He concluded that no contract could come into existence until the deposit was paid. Further, he concluded that the reservation was specific to the Dunlop South Africa group, with the consequence that after mid-June 1998 there was no prospect of that group staying at the Hotel, the measure of damages had there been a contract would, in any event, have been nil.
14. Following the handing down of the judgment in draft, Hallmark, through Mr Hartman, applied to the judge to review or reconsider the judgment. Basically, as I understand it, the ground of this application was that the judge ought to admit a further statement of Mr Barratt which had been obtained by Hallmark, Mr Barratt being by that stage (it appears) in a somewhat improved state of health. The judge, however, refused that application. In the course of a short judgment the judge said:

"The proper course if a party is not satisfied with a judgment is to appeal. There is an exception and there have been several recent cases in which that exception have been discussed."

15. He then refers to one of them, and continues,

"the fact that one of the parties takes a further statement from a witness and that further statement discloses that there may be in existence other documents is neither a strong reason or an exceptional case.

If there is an appeal in this case and if Hallmark Travel wish to make on application for the admission of further evidence they can make it to the Court of Appeal. In my view I should not take account of any further witness statement or any further documentation over and above that which was considered by me at the trial and which led to the judgment which I sent out to the parties a few months ago."

16. The judge was also invited by Mr Hartman to delete from the draft judgment a reference to the evidence of a Miss Murphy, a solicitor who had taken a statement from Mr Barratt in November 1998 which had not been signed. The reference to Miss Murphy's evidence is to be found at the beginning of paragraph 4 of the judgment in its final form, which reads as follows:

"The Hotel's solicitor Miss Murphy (who also was not called, though she provided a signed witness statement) took a statement from Mr Barratt in November 1998 which he did not sign though he confirmed to her that he was 'happy with its contents' and that it would be signed."

17. As to that the judge said this in the course of his judgment when refusing to reconsider the matter:

"Because the point has been raised in the argument, I should perhaps refer to a passage in paragraph 4 on the second page of the judgment concerning the statement of Miss Murphy. If I were able to find the disk on which the judgment is entered I would have been inclined to excise that passage from the judgment. I think I was wrong to cite a statement by Mr Murphy, who did not give evidence. But her statement makes no difference to the reasoning in the judgment and in the circumstances I will leave it in but I draw that matter to the attention of anybody who may read this judgment in case those few lines in paragraph 4 may be misleading."

18. In its proposed grounds of appeal, Hallmark contends primarily that the judge ought to have concluded as a matter of law that the Hotel was not entitled to withdraw the reservation after at the latest such time in June 1998 when Hallmark "applied its efforts to obtain sales of the said rooms", and/or that the Hotel was bound to hold the reservation until payment of the deposit on or before 1 October 1998. Secondly, Hallmark challenges the judge's finding that the reservation was specific to the Dunlop South Africa group. Hallmark contends that this finding was directly contrary to the evidence of Mr Barratt himself as well as that of Mr Wheeler. Thirdly, Hallmark complains that although the judge stated (on the application to review or reconsider the judgment) that a reference to the evidence of Miss Murphy should be excised, the judge had nevertheless allowed it to remain in the evidence and that it appeared that the judge had considered the evidence as a whole, including the evidence of Miss Murphy. It is also contended that the findings of fact which the judge made were contrary to the weight of the evidence before him. In addition, a number of what I may call sub-challenges are made to the judge's findings of fact.
19. In his helpful oral submissions this morning Mr Hartman submits that this proposed appeal has a real prospect of success. He submits that the judge erred in law, that he was in error in including in his judgment a reference to the evidence of Miss Murphy, which, as appears from a reference to the evidence "as a whole" in paragraph 5 of his judgment, played a part in the findings of fact which the judge reached. Mr Hartman also repeats the submission which he made to the judge on the application to reconsider the judgment that the further evidence of Mr Barratt is crucial and should have been considered by the judge; alternatively that it should be considered by the Court of Appeal in the proposed appeal should permission be given.
20. Mr Hartman submits that Hallmark's efforts to find clients for the rooms was valid consideration for what he submits was a contractual offer capable of acceptance so as to create a concluded contract. He submits that that was the start of performance by Hallmark and as such constituted acceptance of the offer and consideration for the resulting contract.
21. In my judgment, however, despite Mr Hartman's submissions, an appeal against Judge Moseley's judgment would have no real chance of success. In the first place I can see no basis for interfering with the judge's findings of fact in this case, and on those findings his conclusion that no contract was included seems to me to be inevitable. Nor can I see any basis for the submission that the judge ought to have acceded to Mr Hartman's application following the handing down of the draft judgment that the trial should, in effect, be reopened and further oral and documentary evidence adduced. Moreover, it seems to me that, as a matter of law, the attempt to represent Hallmark's efforts to find clients to occupy the rooms as consideration for a supposed contractual offer is completely far-fetched and hopeless. Furthermore, the judge's conclusion that the reservation was specific to the Dunlop South Africa group, a finding which is not in my view open to challenge on appeal since it was preeminently an issue for the judge to decide on the facts, effectively puts paid to my claim based on breach of any supposed contract.
22. So far as the evidence of Miss Murphy is concerned, I can see once again no basis for concluding that the judge's reference to Miss Murphy's evidence, notwithstanding that she had not been called to prove her statement, could form the basis of any successful appeal. As he made clear in the short judgment which he delivered when refusing to reconsider the matter her statement had made no difference to his reasoning and accordingly, for that reason, he declined to alter the judgment.
23. I therefore adhere to the views which I expressed on paper when refusing permission to appeal. In so doing I said:

"In the first place, I can see no arguable basis for challenging the judge's findings of fact. Secondly, on those findings it seems to me (as at present advised) that it follows (a) that as a matter of law the claim in contract fails, and (b) that even if the defendant [that is the Hotel] were in repudiatory breach of contract, the measure of damage would in any event be nil."

24. Accordingly, despite Mr Hartman's helpful submissions, this application is dismissed.
(Application dismissed; no order for costs).